Risk & Trading Psychology

Paper trading only works if you do it seriously. Learn the 5-step setup, what to track, transition timeline, and readiness criteria before risking real money on NSE/BSE.

A trading plan is a one-page document with six sections that pre-commits you before the market opens. Learn what goes in each section, the five-layer risk pyramid, and a ready-to-copy sample plan for a ₹5 lakh account.

Revenge trading and overtrading turn controlled losses into account-destroying spirals. Learn the anatomy of the spiral, four warning signs, the recovery protocol, and five mechanical rules that break the loop.

Fear and greed cause most retail trading losses. Learn the specific moments each emotion strikes, how to use India VIX as a crowd-temperature gauge, and five rules that make both emotions operationally irrelevant.

Trading psychology is an engineering topic, not a motivational one. Learn the four trading emotions, six cognitive biases, the 1% rule, and the mechanical habits that make emotional discipline the side-effect instead of the goal.

Quick Answer: A trading journal is a structured log of every trade you take — entry, exit, stop loss, rationale, emotion, and outcome. It turns your trading from guesswork into data. Most traders lose for years without realising they repeat the same three mistakes; a journal surfaces them in weeks. Record pre-trade plan, post-trade outcome, … Read more

Quick Answer: A risk-reward ratio (R:R) compares how much you stand to lose versus how much you stand to gain on a trade. Formula: R:R = Stop Loss Distance ÷ Profit Target Distance. A 1:2 ratio means risking ₹1,000 to gain ₹2,000. Professional traders demand minimum 1:2 — this allows profitability even with only a … Read more

Quick Answer: A stop loss is a pre-set exit order that limits your loss on a trade if price moves against you. It must be placed before you enter, based on chart structure — not how much loss you’re comfortable with emotionally. The 5 main strategies: Fixed Percentage, Support-Based, ATR-Based, Trailing, and Hybrid. Published March … Read more

Quick Answer: Position sizing is calculating how many shares or contracts to buy based on your account size, risk tolerance, and stop loss distance. The core formula: Position Size = (Account Value × Risk %) ÷ (Entry Price − Stop Loss Price). Example: ₹2,00,000 account, 1% risk = ₹2,000, stop loss distance ₹40 → buy … Read more

Quick Answer: Risk management is a system for deciding how much capital to risk per trade to protect your account from catastrophic losses. The professional standard: never risk more than 1-2% of your total account balance on any single trade. If your account is ₹1,00,000, you risk a maximum ₹1,000-₹2,000 per trade — no exceptions. … Read more